Pensions (Extension of Automatic Enrolment) (No. 2) Bill

Debate between Louie French and Peter Gibson

3rd reading
Friday 24th March 2023 Commons Chamber

[Peter Gibson (Darlington) (Con)]

It is a real pleasure to see the Bill reach Third Reading. I am very grateful to you, Mr Deputy Speaker, and to Madam Deputy Speaker, for allowing me to speak for the fourth time today.

I pay tribute to my hon. Friend the Member for Stoke-on-Trent North (Jonathan Gullis) for guiding the Bill through its legislative journey, my hon. Friend the Member for Grantham and Stamford (Gareth Davies) for raising this issue in Westminster Hall last year, and my very good and hon. Friend the Member for North West Durham (Mr Holden) for laying the groundwork for the Bill before he was elevated to high office. It is great to see him in his place today.

When auto-enrolment was introduced, as an employer I was fearful of the impact it might have on my business and fearful of the costs it would burden me with, but auto-enrolment has proved to be hugely successful, reversing the decline in workplace pension saving and ensuring that millions more people are now saving for their future. I saw at first hand the benefits the scheme has had on the lives and futures of my employees. Employees who would never have considered being part of a pension scheme were put in a position where it became a simple and easy process. For the first time, they were ensuring that they did not fall into the trap of under-saving for retirement.

We have to recognise that for those under the age of 22 the number of people enrolled in a pension is woefully low. Among those in part-time employment, although some will earn more than the current £10,000 threshold, the number of those auto-enrolled is still significantly lower than among those who are in full-time employment. The 22-year-old minimum age simply does not work. Why should someone who chooses to start working before they are 22 not be paying into a pension from that age, the same way as someone who is 22? They would have much to gain from auto-enrolment being extended to them. Moreover, we must recognise that the current system also disproportionately impacts women and those on the lowest earnings in our society, who are more likely to be in part-time work and have multiple part-time jobs, like many of my constituents in Darlington.

In 2019, I stood on a manifesto to level up communities across the United Kingdom, and the extension of auto-enrolment is a policy that has the potential to have a real positive impact on people’s futures. It would be a commitment to level up for the long-term. The Bill is levelling up in action.

Extending auto-enrolment could potentially add trillions of pounds to the nation’s pension pot. It is a chance to ensure that people are saving for their future from a young age. It allows us to ensure that the poorest in society have a more secure future and takes steps towards closing the gap between men and women’s pension savings.

[Mr Louie French (Old Bexley and Sidcup) (Con)]

Alongside this positive Bill, which builds on the success of auto-enrolment, which the Conservative Government adopted, does my hon. Friend agree that it is important we also support the Government’s initiatives to roll out pensions advice more widely, so that people have a better understanding of their own financial situation and pensions saving, particularly for men, women and younger people?

[Peter Gibson]

My hon. Friend makes a really important point. I know only too well, from conversations I had with family members encouraging me to take up a pension when I was in my early 20s, it seemed an awfully long way off. I can tell the House, some 30 years later, that it comes around very, very quickly. The earlier we all start saving, the better.

In conclusion, the extension of auto-enrolment would have huge benefits for many people in Darlington and right across the country. I am delighted to support the Bill and look forward to it completing its legislative journey.